inequality
 
‘I’m confused. Confused. Don’t wanna be confused,
Stupid attempts, no conclusions’

 

Initially I had planned to write this piece after the budget, as a weekly commentary should be topical and up to date.

Then I realised that for much of my adult life I had avoided listening, reading about, or commenting on the budget on the basis that I cannot influence or change it, and grudgingly accept I will be worse off as a result.

My issue with this budget is somewhat different, the credibility of the government to handle the country’s finances.

I evidence this with the ‘Track & Trace’ debacle, not only was there blatant cronyism in the appointment of Tory peer Dido Harding to head the disastrous programme there is also the small matter of the £22bn she has spent, which, in the words of the health department, has had a ‘relatively small’ effect.   

The Scientific Advisory Group for Emergencies (Sage) described the success of the supposedly ‘world-beating’ system as ‘marginal’, whilst other experts have claimed it is not fit for purpose.

Even for our Queen, £22bn is a lot of money, it takes genuine incompetence to have little, or no ‘trace’ of that much money. I am not unreasonable enough to expect them to account for every penny, the nearest £100m will do.

However, I suspect that this will be lost behind the sofa and buried in the wave of goodwill that the successful vaccine role out has provided.

 

£22bn is a lot of money, it takes genuine incompetence to have little, or no ‘trace’ of that much money

 

Speaking of sofas, the PM is having a few problems in this area. The Guardian reports that plans to set up a charity to cover the costs of the refurbishment of Johnson’s flat which he shares with his fiancée, Carrie Symonds, have been challenged by a former chair of the standards watchdog and a former charity commissioner.

Their comments have been made as lawyers within Downing Street try to establish whether the government can legitimately fund the prime minister’s flat through a charitable vehicle using cash from Tory donors.

What this actually means is that Carrie has designs beyond the capacity of Boris’s wallet, and, rather than making do or compromising as the rest of us must, our PM wants Tory donors with more money than sense, or desperate for a knighthood, to pay.

Sir Alistair Graham, a former chairman of the Committee on Standards in Public Life, said, ‘I’d be surprised if it was within the law to set up a charity and get tax benefits for the home of a public servant. To do so there has to be wider public benefits for a group who are in charitable need. I am really not sure if the prime minister and his fiancé would qualify,’ he told the Guardian.

Oh, c’mon Ali, of course they don’t qualify!

Now we turn to the PR guru, Matthew Freud, who was associated with the Conservatives during David Cameron’s time as PM, who’s firm was awarded a contract to provide ‘strategic communications’, including ‘reputation management’, for England’s beleaguered coronavirus test-and-trace system without a tender process.

The contract with Freud Communications Limited was for services to be carried out between 1 November last year and 15 January this year but it only came to light after details were published on a government website on 19 February.

What fascinates me is the governments web site that states, ‘although the start date for the £55,000 contract with Freud Communications was 1 November, it was awarded on 8 February 2021. Errr?

This appeared on the same day as a high court judge ruled that Matt Hancock acted unlawfully by failing to publish details of multibillion-pound C-19 government contracts within the 30-day period required by law, amid allegations of ‘chumocracy’ and lack of transparency in the awarding of contracts during the pandemic.

Gemma Abbott, the legal director of Good Law Project, which brought the high court action against the government, said of the contract: ‘Another day, another deal awarded with only a handshake and documented later. The fact we are just seeing the details of this arrangement now, months after work began and after the work has already been completed, speaks volumes about this government’s complete disregard for transparency. For the sake of good governance and protecting taxpayers’ money, government must get its house in order on procurement.’

 

For the sake of good governance and protecting taxpayers’ money, government must get its house in order on procurement

 

Now with due deference to yesterday’s budget let us turn to austerity and the have nots.

In a report on the pandemic, the TUC found that C-19 has held up a ‘mirror to the structural racism’ in the UK’s labour market. The study found that jobless rates among black, Asian and minority ethnic (BAME) groups are double the rate for white people:

 

  • There are 1.74 million people out of work across the UK, the highest level in five years, with a disproportionate number of women and ethnic minorities.
  • Official unemployment statistics showed 1 in 10 women of colour were out of work.
  • Overall BAME unemployment rate had risen from 5.8% to 9.5% between the final quarter of 2019 and the same time last year.
  • Over the same period, the unemployment rate for white workers rose from 3.4% to 4.5%.

 

The TUC general secretary, Frances O’Grady, said; ‘This crisis has to be a turning point. As we emerge from the pandemic, we can’t allow these inequalities in our workplaces and our society to remain. Ministers must stop delaying and challenge the systemic racism and inequality that holds back BME people.’

There are some people who still try to defend the Tories record on austerity, pointing out that there was a period 2-year in George Osborne’s reign as chancellor, when the spending taps were turned on and austerity was no more.

Many of these naysayers were unhappy with this imagined spending spree, believing that more austerity was justified. These are the same people who rage at people like me who perpetuate the ‘austerity myth’.

The truth is that many economists viewed the Treasury as ‘austere’ because the rate of increase in spending was below the prevailing rate, meaning that public sector budgets was negative in real terms.

This macro view of government spending is what lies behind Sunak’s shock and disbelief when he is accused of sticking with austerity.

Johnson’s repeated insistence that austerity is over, and his crusade to ‘level up’ doesn’t sit well with many Tories, including Sunak, who’s recently insisted that government borrowing to finance greater spending is ‘morally, economically and politically’ wrong.

As such this budget will likely be sold to us as the work of a government with a keen sense of its current responsibilities, a social conscience, and big plans. After all, the Chancellor is borrowing around £400bn to rescue the economy, and has kickstarted the largest public works programme for 20 years; Austerity?

A less rose-tinted opinion is offered by the Institute for Fiscal Studies, showing that the trends set in the Osborne years, of increasing spending in a few areas of government, while leaving to starve, is set to continue.

The usual suspects, such as health, schools, and the state pension, will be favoured, with the possible addition of the police and border control.

Beyond Westminster, key areas such as local government will continue to experience deeper spending cuts, leading to a sixth year of inflation-busting council tax rises in April, which will hit low- and middle-income earners the hardest. The 5% jump sanctioned by the Treasury is supposed to be a generous loosening of the purse strings when inflation is only 0.7%.

 

a sixth year of inflation-busting council tax rises in April, which will hit low- and middle-income earners the hardest

 

This would be true if the £1.9bn of ‘spending power’ that local governments will gain were to be drawn from borrowed funds along with the rest of the chancellor’s £400bn. However, they are trapped by government rules that force them to balance the books each year, meaning that councils must either increase tax up to the 5% cap, or reduce services.

One element of the tax increase is a maximum 3% rise in the ‘social care precept’ to cover rising care costs. This is married to a maximum 1.99% increase to cover general running costs. To increase the tax by more than 4.99%, councils must ask taxpayers in a local referendum.

This comes at a time when the social crisis unleashed by C-19 is putting renewed pressure on the most essential services, including help for older people, those with disabilities, and at-risk children.

Last month it emerged that at least 12 councils in England were in emergency talks with the government to avoid bankruptcy, and across the country budget crises are becoming the norm:

 

  • Manchester city council is facing cuts in the next financial year of £41m.
  • Bolton is facing cuts of £35m.
  • The London Borough of Newham is expecting ‘cuts and savings’ of £43m by April 2023, £30m of it this year.
  • The council in Leeds is now facing economies of £87m, the single biggest amount to be taken out of its spending since the start of austerity – and which, according to the city’s new leader, James Lewis, could be followed by further cuts of as much as £60m unless the government takes decisive action.

 

Focussing on inequality, a report recently published by the Policy Institute at King’s College London, finds that most people, irrespective of their politics, see geographical inequalities, and inequalities of income and wealth, as serious problems that need tackling. However, their attitudes to inequality are based on their political inclinations:

 

  • Three times as many Labour voters as Tory voters believe Britain was ‘very unequal’ before the pandemic.
  • Labour Leavers are closer to Labour Remainers than they are to Tory Leavers on most questions about inequality.
  • 66% of Labour Remainers and six in 10 Labour Leavers want more active government intervention in the economy in the future,
  • Compared with 32% of Tory Leavers and 22% of Tory Remainers, who view government support for people and businesses during the pandemic as a one-off.
  • Fewer people think that inequalities between racial and ethnic groups, or between men and women, are as serious as geographical disparities or differences of wealth.
  • 75% of people think it would be a ‘very big’ or ‘fairly big’ problem if racial inequalities increased post-pandemic.
  • 66% think the same about gender inequalities.

 

In short, whilst people don’t dismiss inequities created by race or gender, they don’t see them as significant as disparities created by wealth or location.

Then we have the racists:

 

  • 13% believe that ‘most black people don’t have the motivation or willpower to pull themselves up out of poverty’, and
  • 4% that they have ‘less in-born ability to learn’.

 

Despite other comments to the contrary, I am incredibly surprised that almost 50% of respondents thought that those who became unemployed during the pandemic had lost their jobs primarily because of their performance at work.

I have always accepted that there are a great many stupid people, but this beggars belief. Perhaps it demonstrates how successful the government has been in deflecting blame away from itself, with the net result that the public see other people as being responsible for rising cases and deaths from C-19.

 

I have always accepted that there are a great many stupid people, but this beggars belief

 

However, this does support the long history of viewing poverty and inequality as moral rather than political issues, i.e. as a failure of the individual not government.

This theory first found favour in the Thatcherite ‘80s, where economic and social changes fueled inequality. These policies fragmented society, shattered communities, broke trade unions, and eroded civil society leading people to embrace individualism because they cannot a better alternative. (1)

The final section of the report suggests that ‘there is no widespread appetite for change’. I disagree.

People feel disaffected and want change but live in a world in which the vehicles for change seem unfit for purpose.

This explains why people have moved on to the terrain of culture and identity, which have stoked the politics of identity within working-class communities and among middle-class liberals, as both look in different ways to cultural answers for political problems.

Unequal Britain shows why traditional left-right divisions remain important but also why it’s become more difficult to see social problems in those terms.

Further evidence of how the Tories view the have nots was provided by the Conservative candidate for London mayor, Shaun Bailey, who during a discussion on paying people a universal basic income (‘UBI’) said ‘I’ve been a youth worker for over 20 years. I know some people would absolutely fly if you gave them a lump sum to deal with every week. I know some people who would buy lots of drugs. So where is the care in this, where is the care for the person? How do you get past just universally giving people money?’

Bailey also questioned whether UBI could ‘drive prices up for basic goods when we know people could just buy them because the money’s there’. He added he was ‘concerned about work incentive’ and a UBI was not clearly defined.

In response, the Labour MP Wes Streeting said Bailey’s comments had ‘shown his utter contempt for hard-pressed families. He has proven once again that he does not share London’s values.’

These comments are the latest in a series of controversial remarks by the Tory candidate. Last week, he was criticised for an interview with the Sun in which he said teenage mothers pushed people who ‘do the right thing’ down the housing ladder. He has also suggested that homeless Londoners could save up a £5,000 deposit for a mortgage.

As I end this piece, knowing that I will likely be worse off due to the budget, I  console myself with the words of [the former] Prince Harry; ‘‘Because it’s been unbelievably tough for the two of us, but at least we had each other.’

 

‘There’s tears coming out from everywhere,
The city’s hard the city’s fair,
Get back inside you’ve got nothing on..’

 

Notes:

  1. Bobby Duffy, lead researcher for the study observes, that Policies which fragmented society, shattered communities, broke trade unions and eroded civil society have led people towards individual rather than systemic explanations for inequality. It’s not, he says, that people are embracing an ‘everyone for themselves’ attitude, nor is it ‘an outright rejection of collective action’. Rather, people are pushed into a kind of ‘reluctant individualism’ because they ‘struggle to see how to get to a better alternative’.

 

When the preamble kicks off with ‘everyone gets a kicking this week; Sunak, Johnson, Carrie, the Tories in general, and two sneaky jabs at her maj and Harry’ you sense that Philip has served up a treat, and I certainly don’t feel in any way unsatiated.

The pace and magnitude of unfolding events are very neatly summed up by the fact that in the 24hrs since Philip penned his piece, the media is now quoting that Dido Harding has in fact spaffed £37bn on the toe-curlingly embarrassing ‘track and trace’ app rather than the previous relative loose change of £22bn.

Feel outraged enough to complain? Please direct any correspondence to ‘Chair of NHS Improvement and NHS Test and Trace’ John Penrose, er, Mr Dido Harding.

I suspect that a lot of people will identify with Philip’s historical antipathy to budgets on the basis that if you drove to a bar to console yourself over a pint and a cigar you were almost inevitably compounding your misery; events of the last 24 hrs would potentially have blindsided him.

OK, so we’re in a hole, and someone has to pay; few would disagree with Philip’s summation that the have-nots have been disproportionally walloped by Brexit and Covid, but at least we’re all in this together.

Until, of course Nadine Dorries was sent out to deliver the news that NHS workers were to receive a 1% pay rise, because that is all the government could afford.

Leapfrogging Barnard Castle, Hancock’s Half Truths, quarantine hotel cock-ups and ‘Divs for Spivs’ contracts, could there be anything that shouts ‘we really don’t GAF’ than a proposal to make healthcare workers poorer in real terms.

In the context of Brenda’s ‘anni horribiles’ based on the bad behaviour of at least two of her grandchildren, who would wish the past twelve months on anyone, and to insult healthcare workers with a handful of change could do more to damage this administration than Keir Who ever could.

That Boris is trying to set up a charity to get the red wine stains out of Carrie’s sofa won’t surprise anybody;  neither will the findings of the survey conducted by the Policy Institute at King’s College London.

Possibly the takeaway from what is an excellent and reflective piece, are all the issues that are being stored up – councils cranking tax increases to the max for those that can ill afford it, kicking the can down the road with the furlough scheme, supporting ghost jobs and broken dreams.

On the same day, Cyprus announced that it values Engerland’s finest on the lash more highly than it does the health and wellbeing of its own people; by welcoming those that have had two doses of the vaccine from May 1 this is a massive incentive for the young to say ‘yuck fou’ to any future restrictions and we can all look forward to more lockdowns courtesy of the Saga louts. 

Just the two tracks, but hats off for a couple of belters; not entirely mainstream but for fun only, enjoy Black Flag with ‘Damaged II’ and The Libertines with ‘What a waster’. Let’s be careful out there. 

 
 

Philip Gilbert 2Philip Gilbert is a city-based corporate financier, and former investment banker.

Philip is a great believer in meritocracy, and in the belief that if you want something enough you can make it happen. These beliefs were formed in his formative years, of the late 1970s and 80s

 

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